Taaleem Management Services [TALM]
Egypt / Consumer Discretionary / Pre-IPO Note
IPO Maximum Price EGP6.2/share
Implied Market Cap EGP4.5bn
Investment Rating: Not Rated / Risk Rating: Not Rated
The local landscape suggests further growth for private education providers: In Egypt, the government is a dominant operator within the education sector. Of the 2.6mn higher education students enrolled in Egyptian universities in FY20, only 207,154 students were in private universities or c.8%. Still, a private-sector education provider can find plenty of untapped opportunities. Egypt is one of the attractive markets for private education providers for several reasons. First, it is the most populous country in the MENA region, with somewhat steady growth. Also, its population in the 5-24 year age bracket represents around 40% of total. Second, the total number of students enrolled in private universities rose at a CAGR of 12% in the past 12 years (FY09-FY20), when students in public universities grew at a CAGR of a mere 3%. Third, to throw off the burden on the state budget, the government is encouraging more private education providers to invest in Egypt. Fourth, parents are keen to provide their young with better education to meet the labor market needs. Yet, affordability stands in their way as a main obstacle. Hence, we believe private universities that offer affordable fees will squeeze the most out of this sector’s growth potential.
Nada Wagdy
Equity Analyst
T +202 3300 5726
Sherif El Etr
Equity Analyst
T +202 3300 5720